Oil & Gas Exploration & Production in Coastal Belt of Sindh

Brazils-CCB-Offshore-Extends-Presence-in-AsiaSindh contributes 71% of Pakistan’s overall gas production and 56% of the country’s Oil production. Around 40% of Pakistan Oil reserves are in Sindh. Badin Concession Block that consists of 05 districts (Badin, Tando Muhammed Khan, Hyderabad, Tando Allahyar and Thatta) of Sindh is spread over an area of 10000 square kilometers having 12 major fields, 307 wells and thousands of pipelines. Among oil & gas producing coastal districts of Sindh, district Badin is reported to be at the forefront in Pakistan’s overall Oil production. But when it comes to development, Badin suffers the most. Human Development Report of UNDP in 2003, ranks district Badin at 60th numbers out of 91 districts of Sindh.

Oil and Gas exploration in the coastal area took start in 1978. Khaskheli Oil Field near Kario Ghanwer, Badin proved to be a major discovery by Union Texas in 1981 in the coastal district. This discovery was followed by other major discoveries in the same area. British Petroleum Pakistan took over after UTP in 2011. United Energy Pakistan-UEP, a subsidiary of United Energy Group-UEG which is a Hong Kong listed company afterwards assumed control of oil and gas exploration and production assets managed by BP Pakistan in September 2011.

Inspite of being blessed with rich Oil & Gas reserves, the coastal belt of Sindh is the one that suffers the most in terms of development be it infrastructure, education or health . District Thatta, Badin and Sujawal districts are the ones that are mostly found on lowest in almost all of the human development indicators. Favorable indicators of a good living standard are the basic human rights of the indigenous communities from where the Oil & Gas resources are being mainly extracted.

DEVELOPMENT FUNDS

The Petroleum Exploration & Production Policy and Petroleum Concession Agreement of Pakistan clearly mention that the amount of development pledged by Oil & Gas exploration and production companies in their agreements shall be utilized for the development of the indigenous communities in and around the concession area. As stipulated in Article 23.3 of Petroleum Concession Agreement and Petroleum Exploration & Production Policy 2012 the funds of production bonus received from oil & gas production shall be expensed in and around the Concession Area. Royalty (12.5%) and production bonus from the concession blocks is paid to federal government by the companies. Federal government has to further channel out these development funds to provincial government who finally transfers it to the district administration to be expensed for the development of areas in and around the concession block.

The fact that the Oil and Gas exploration & production was initiated more than 3 decades ago in the coastal areas of Sindh speaks volumes of the queries as to whether the development funds have been consistently utilized keeping the time frame of Oil and Gas exploration and production in mind. Field visits to the areas show that the details of the social welfare projects actually completed on ground do not validate the realistic spending. Thus acting against the policies and agreements, Oil & Gas companies, federal government, provincial government, elected representatives and officials of the concerned departments at the district level have collaboratively been misappropriating the public money for many years.

RIGHT TO INFORMATION

As per Right to Information Bill, Petroleum Exploration & Production Policy and Petroleum Concession Agreements facts & figures regarding overall work of Oil & Gas companies have to be shared with general public since it is their right to have the information needed. But the corporate companies who are profiting from the lands succeed in avoiding such queries or public pressure by fair or foul. The local communities who had been living in the area for decades have very little knowledge about what Oil and Gas Companies are doing around there dwellings. They also face disappointment from the concerned government authorities. Availability of the concerned government officials in their offices in office hours is a major difficulty they face when they approach them. District Information Cells that are supposed to have the updated information relating to oil and gas exploration are either found to provide out-dated information or refuse to share such information using lame excuses. District Welfare Offices do not have any record of Social Welfare projects undertaken by corporate companies as part of Corporate Social Responsibility in their respective districts.

Website of Ministry of Petroleum & Natural Resources, Government of Pakistan presents the data that cannot be easily analyzed district-wise. One has to work hard to figure out the exact number of Oil and Gas facilities in a particular district since the location of the areas is mentioned vaguely which creates a lot of hassle for an ordinary person to access and understand the required information.

EMPLOYMENT OPPORTUNITIES FOR LOCAL PEOPLE

Local communities of the concession areas are not given their due share in employment. The local youth by and large continues to remain ignored in employment and training opportunities. Oil and Gas companies in these coastal districts hire influential lords as their local contractors who are always at the forefront when it comes to any public agitation for employment and other issues. Through personal contacts it is also known that the jobs are deliberately not advertised in local or national newspapers lest local youth from these districts should know about these jobs. Applications from fresh graduates belonging from the concession areas for internships other trainings opportunities are not accepted. Only the ones who have references and recommendations from influential persons get the chance. On the other hand fake and forged internship certificates are awarded to the students from the other provinces.

In case of unavailability of trained technical staff from the area, the concerned company is responsible to train the local staff technically as per the budget agreed in the Petroleum Concession Agreement. But violating all the agreements the company hires field and management staff from out-side the province.

DENIEL OF RIGHTS TO INDEGINOUS MINORITY COMMUNITIES

Indigenous minority communities are the ones that become are found more vulnerable who live around these oil and gas fields. Daily-wage opportunities of labor are denied to local minority communities who had been living here since decades no matter how hard they strive for it. The local Hindu minorities who remain deprived of daily-wage labour opportunities say that the major reason of their not getting any labor opportunities oil and gas companies fields nearby their homes is that the land-owners whose land they cultivate as peasants work as employees and contractors for these oil and gas companies. These local land lords hire their own people rather than the needy poor people for their contract activities. So their chances of getting opportunities for their bread and butter become lesser. Resultantly their families are more prone to food insecurity, illiteracy, unimproved health and many other socio-economic threats. So during off-season, these under-privilideged communities are compelled to migrate to other remote areas to make both ends meet. The transportation costs of their temporary migration make matters worse for them, besides they live in make-shift shanties where ever they migrate to. The visit to their homes paints a gloomy picture as no school or hospital buildings are found in the vicinity of the villages where the oil and gas exploration is carried out. The villagers use brackish muddy water of a nearby water-course for drinking and all other purposes. No provision of electricity is made there in these villages.

The plight of human rights observed in the coastal belt of Sindh must shows that inspite of being a democratic state, the state needs to ensure the right to a good to the people who contribute to the country’s domestic production. The situation must prod the authorities into an action that ensure justice to the people of these under-developed areas of province Sindh.

Writer:

Roshan Bhatti

Manager Monitoring & Evaluation

Pakistan Fisherfolk Forum, Karachi.

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